University of Arkansas at Little Rock William H. Bowen School of Law Bowen Law Repository: Scholarship & Archives Faculty Scholarship 2012 Subordinate Bias Liability Theresa M. Beiner University of Arkansas at Little Rock William H. Bowen School of Law, [email protected] Follow this and additional works at:http://lawrepository.ualr.edu/faculty_scholarship Part of theCivil Rights and Discrimination Commons,Labor and Employment Law Commons, and theLaw and Gender Commons Recommended Citation Theresa M. Beiner, Subordinate Bias Liability, 35 U. Ark. Little Rock L. Rev. 89 (2012). This Article is brought to you for free and open access by Bowen Law Repository: Scholarship & Archives. It has been accepted for inclusion in Faculty Scholarship by an authorized administrator of Bowen Law Repository: Scholarship & Archives. For more information, please contact [email protected]. SUBORDINATE BIAS LIABILITY Theresa M Beiner* I. INTRODUCTION Employment decisions are often made with the input or based on the observations of more than one person. Because multiple people often play a role in an adverse employment decision, complications arise for employ- ment discrimination plaintiffs trying to prove that discriminatory animus played a part in that decision. Can an employee complain when her cowork- er or direct supervisor is overly critical of her because she is a woman? What if that person provides incorrect information or distorted information about the employee that results in those who do have the authority to fire her terminating her employment? Does she have a claim for sex discrimination? The Supreme Court of the United States sought to answer this and oth- er related questions in Staub v. Proctor Hospital.' Prior to the Staub deci- sion, the circuit courts were split about the circumstances under which fact- finders could hold an employer liable for the discriminatory animus of sub- ordinate supervisors or coworkers who did not have decision making author- ity, which is known as the "cat's paw" theory of liability or "subordinate bias liability."2 In particular, Staub addressed subordinate bias liability in the context of bias by a non-decision making supervisor. This article sets out the varying theories that the circuit courts adopted to handle such cases, parsing the differences and ambiguities that resulted. It then looks at the Supreme Court's attempt to settle these ambiguities in the Staub case and points out where the Court created additional ambiguities. The article also addresses the substance of Staub and finally critiques the Court's approach. In the end, the Court adopted none of the formulations used by the circuit courts and set a standard that may be difficult for plaintiffs to meet. * Nadine Baum Distinguished Professor of Law, Associate Dean for Faculty Devel- opment, University of Arkansas at Little Rock, William H. Bowen School of Law. This paper benefitted from comments by participants at the Sixth Annual Labor and Employment Law Colloquium held in Los Angeles, California in September of 2011 as well as helpful com- ments by Sandra Sperino. This paper was supported by a research grant from the UALR William H. Bowen School of Law. 1. 131 S. Ct. 1186 (2011). 2. See, e.g., Sara Eber, Comment, How Much Power Should Be in the Paw? Independ- ent Investigations and the Cat's Paw Doctrine, 40 LoY. U. CI. L.J. 141, 155-74 (Fall 2008) (describing the three approaches adopted by various circuit courts). 89 90 UALR LAW REVIEW [Vol. 35 II. THE CAT'S PAW, SUBORDINATE BIAS LIABILITY, AND THE SPLIT Cat's paw liability originally got its name from Judge Posner's decision in the Seventh Circuit case Shager v. Upjohn Co.,3 which involved age dis- crimination. The "cat's paw" term comes from the Aesop fable, "The Cat, the Monkey, and the Chestnuts." In this fable, a cat and a monkey are sit- ting in front of a fireplace in which some chestnuts are roasting in the hot ashes.' The monkey convinces the cat that he has the perfect paws with which to pick the chestnuts out of the fireplace.6 The cat tries to do so, burn- ing his paws, but eventually successfully pulls multiple chestnuts out of the fireplace.' When he finally stops to enjoy his ill-gotten chestnuts, he finds that the monkey has eaten them all.' The moral of this fable has been vari- ously stated. One interpretation is that "[a] thief cannot be trusted, even by another thief."' Another common moral ascribed to this story is "[t]he flat- terer seeks some benefit at your expense."o A more simple interpretation is "[d]on't be tricked into misbehaving."" Finally, Webster's dictionary de- fines it as "one used by another as a tool."l2 As for how Judge Posner used it in Shager, the "cat's paw" was a two- word characterization of his "conduit" theory of subordinate bias liability in the context of an age discrimination claim." Shager involved the termina- tion of Ralph Shager from his job as a sales representative for Asgrow Seed Company ("Asgrow"), which Upjohn acquired when Shager was fifty-years- old.'4 Shager reported to Asgrow's youngest district manager-John Lenhst-who Shager argued harbored animus against older workers." In spite of being placed in a division in which it was very difficult for Shager 3. 913 F.2d 398 (7th Cir. 1990). 4. Aesop, The Cat, the Monkey, and the Chestnuts, FABLES AND FAIRY TALES: A TREASURY OF CHILDHOOD STORIES FROM 1909, http://fairytales4u.com/fable/fable2.htm (last visited Sept. 29, 2012). 5. Id. 6. Id. 7. Id. 8. Id. (the cat and monkey stole the chestnuts from their master). 9. Aesop, Aesop's Fable: The Monkey and the Cat, READ BOOK ONLINE, http://www.readbookonline.net/readOnLine/6648/ (last visited Sept. 29, 2012). 10. Aesop, The Monkey and the Cat, CHILD BIBLE STORY ONLINE, http://www.childrenstory.info/childrenstories/themonkeyandthecat.html (last visited Sept. 29, 2012). 11. Aesop, The Monkev and the Cat, NURSERY-RHYMES-FUN, http://www.nursery- rhymes-flun.com/themonkeyandthecat.html (last visited Sept. 29, 2012). 12. Cat's Paw Definition, MERRIAM-WEBSTER.cOM, http://www.merriam- webster.com/dictionary/cat's%20paw (last visited Nov. 1, 2012). 13. Shager v. Upjohn Co., 913 F.2d 398, 405 (7th Cir. 1990). 14. Id. at 399. I5. Id. at 399-400. 2012] SUBORDINATE BIAS LIABILITY 91 to meet the sales goals Lenhst set, Shager actually surpassed his sales goals." Yet, Lehnst placed Shager on probation because of purported diffi- culties in collecting on accounts and eventually recommended to the Career Path Committee that Shager be fired." That committee thereafter fired Shager." Shager submitted evidence suggesting that Lehnst was uncomfort- able with older employees and that Lehnst sought out another younger man with no experience to work as a sales representative in an easier territory." The trial court granted summary judgment in Asgrow's favor.20 One of the issues on appeal was whether Lehnst's hostility toward old- er workers could be imputed to Asgrow.2 The court concluded that there 1 was sufficient evidence that Lehnst's bias could have "tainted" the decision making process to withstand summary judgment." As Judge Posner ex- plained: If [the Career Path Committee] acted as the conduit of Lehnst's preju- dice-his cat's-paw-the innocence of its members would not spare the company from liability. For it would then be a case where Lehnst, acting within (even if at the same time abusing) his authority as district manag- er to evaluate and make recommendations concerning his subordinates, had procured Shager's discharge because of his age. Lehnst would have violated the statute, and his violation would be imputed to Asgrow23 In ruling in this manner, Judge Posner explained that "[i]f the rule were different, the establishment of corporate committees authorized to rubber stamp personnel actions would preclude a finding of willfulness no matter how egregious the actions in question."24 The cat's paw theory eventually became known by a more apt name- subordinate bias liability.25 Not surprisingly, subordinate bias liability took on a life of its own after this case, resulting in splits among the circuits re- garding the circumstances under which fact-finders should hold an employer liable for an adverse employment decision where the decision maker did not have discriminatory animus but those who informed his or her decision did. 16. Id. at 400. 17. Id. 18. Id 19. Shager, 913 F.2d at 400. 20. Id. at 401. 2L Id. at 404. 22. Id. at 405. 23. Id 24. Id. at 406. 25. See, e.g., Taran S. Kaler, Controlling the Cat's Paw: Circuit Split Concerning the Level of Control a Biased Subordinate Must Exert over the FormalD ecisionmaker's Choice to Terminate, 48 SANTA CLARA L. REv. 1069, 1070 (2008). 92 UALR LAW REVIEW [Vol. 35 Fortunately, other commentators already have identified and character- ized the nature of the split. Most commentators have recognized three dif- ferent approaches adopted by various circuits, while occasionally suggesting that the range of approaches falls more on a continuum.26 However one characterizes the split, it appears that it resulted in three predominant ap- proaches: one that is more lenient and therefore more easily satisfied by the plaintiff" (sometimes referred to as the "input standard"28 or "any influence standard");29 one that is in the middle, which purportedly balances the inter- ests of the plaintiff and the defendant" (sometimes referred to as the "causa- tion standard");31 and one that is more strict and is much more difficult for a plaintiff to satisfy32 (sometimes referred to as the "actual decision-maker standard"" or "principally responsible standard").34 Russell v. McKinney Hospital Venture," from the Fifth Circuit, pro- vides an example of the most lenient, or "input," standard. As the name coined for this standard suggests, to meet it, a plaintiff need show only that "a biased supervisor without decisionmaking authority gave information that might have influenced or affected an adverse employment decision."" Plain- tiff Sandra Russell alleged that she was fired from her job as director of clin- ical services for Columbia Homecare based on her age-fifty-four-years- 26. See, e.g., Stephen F. Befort & Alison L. Olig, Within the Grasp of the Cat's Paw: Delineating the Scope of Subordinate Bias Liability Under FederalA ntidiscriminationS tat- utes, 60 S.C. L. REV. 383, 389 (2008) (calling it a "continuum," but then settling on three predominant approaches-the lenient, intermediate, and strict approach); Eber, supra note 2, at 155-74 (describing three approaches-the input standard, causation standard, and actual decision maker standard); Kaler, supra note 25, at 1076-84 (identifying three standards by circuits that espouse them and then an array of varied standards); Sean Ratliff, Independent Investigations:A n Inequitable Out for Employers in Cat's Paw Cases, 80 U. Colo. L. Rev. 255, 260-68 (2009) (describing the three standards as "able to influence," actual decision maker, and essentially the causation standard); Rachel Santoro, Narrowing the Cat's Paw: An Argument for a Uniform Subordinate Bias Liability Standard, II U. Pa. J. Bus. L. 823, 824 (2009) (breaking the approaches down to three categories, including "principally responsi- ble," "any influence," and "causal connection"). 27. See Befort & Olig, supra note 26, at 389. 28. See Eber, supra note 2, at 155. 29. See Santoro, supra note 26, at 824. 30. See Befort & Olig, supra note 26, at 395. 31. See Eber, supra note 2, at 157-58; see also Santoro, supra note 26, at 824 (calling it the "causal connection" standard). 32. See Befort & Olig, supra note 26, at 392-94. 33. See Eber, supra note 2, at 164-65. 34. See Santoro, supra note 26, at 824. 35. 235 F.3d 219 (5th Cir. 2000). 36. See id. Commentators have noted that the First and D.C. Circuits follow a similar standard. See, e.g., Ratliff, supra note 26, at 260-62 (citing and describing Cariglia v. Hertz Equip. Rental Corp., 363 F.3d 77, 87 (1st Cir. 2004) and Griffin v. Wash. Convention Ctr., 142 F.3d 1308 (D.C. Cir. 1998)). 37. Eber, supra note 2, at 155. 2012] SUBORDINATE BIAS LIABILITY 93 old." Russell alleged that her fifty-three-year-old boss, Carol Jacobsen, fired her at the behest of twenty-eight-year-old Steve Ciulla, who was the son of the chief executive officer of Columbia Homecare's parent company." A jury agreed, returning a verdict in Russell's favor and awarding her $25,000 in back pay."' The trial judge, however, disagreed and granted Columbia's renewed motion for judgment as a matter of law." As part of the appeal, the Fifth Circuit considered what influence Ciulla had on Russell's termination.42 Apparently wanting Russell fired, Ciulla allegedly issued an ultimatum to Jacobsen (who was also his boss) that he would quit if she did not fire Russell.43 There was evidence that Ciulla had problems with Russell's age." Specifically, Russell testified that Ciulla fre- quently called her "old bitch" to the point where she actually wore earplugs to avoid hearing it.45 In ruling that a reasonable jury could find for Russell under these circumstances, the court used language of subordinate influence: "If the employee can demonstrate that others had influence or leverage over the official decisionmaker, and thus were not ordinary coworkers, it is prop- er to impute their discriminatory attitudes to the formal decisionmaker."46 The court further explained that "it is appropriate to tag the employer with an employee's age-based animus if the evidence indicates that the worker possessed leverage, or exerted influence, over the titular decisionmaker."47 While this language gives rise to an influenced-based form of liability, the court also suggested that Ciulla effectively became the decision maker in this instance because of the "informal power" he possessed.48 Still, with such broad language of influence, it is easy to see how a court could deter- mine that if a biased supervisor or coworker in some way influenced the decision maker (by, for example, providing erroneous information about the intended victim of discrimination), the language of this case would be broad enough to cover that situation.49 The intermediate standard, or causation standard, is usually attributed to the Tenth Circuit in EEOC v. BCI Coca-Cola Bottling Co. of Los Ange- 38. Russell, 235 F.3d at 221. 39. Id 40. Id 41. Id. 42. Id at 225-26. 43. Id. at 224. 44. Russell, 235 F.3d at 226. 45. Id. at 226. 46. Id 47. Id. at 227. 48. Id. at 227-28. 49. See, e.g., Laxton v. Gap Inc., 333 F.3d 572, 584 (5th Cir. 2003); Bowden v. Potter, 308 F. Supp. 2d 1108, 1121 (N.D. Cal. 2004). 94 UALR LAW REVIEW [Vol. 35 les.5o In this case, Stephen Peters alleged that BCI Coca-Cola Bottling Co. of Los Angeles ("BCI") fired him based on the racially discriminatory animus of a non-decision making supervisor, Cesar Grado." Peters, who was black, alleged that Grado treated black employees worse than he treated Hispanic employees, including providing evidence regarding a Hispanic employee who was not fired (or even disciplined) for engaging in the same actions that allegedly caused Peters's termination.52 BCI asserted that Peters was fired for insubordination based on a conversation he had with Grado in which Peters refused to work on the weekend." It ended up that Peters had actually called in sick to another supervisor, Jeff Katt, and was excused from work- ing on that weekend.54 However, rather than Grado, it was Pat Edgar, who worked 450 miles away in the company's Phoenix office, that terminated Peters. At the time Edgar made the decision to terminate Peters, she did not know he was black.56 In making the determination to fire Peters, Edgar relied on representa- tions by Grado about the events leading up to the weekend shift that Peters missed.57 Grado's description of what happened that Friday varied from that of both Peters and Katt, and Edgar never asked Peters for his "side of the story."' Because of the influence of Grado on Edgar's decision to terminate Peters, as well as the evidence of Grado's purported discriminatory animus, the court held that summary judgment was improper because there was an issue of fact as to whether the reason BCI gave for Peters's termination- insubordination-was a pretext for discrimination.59 In reaching this conclusion, the court provided another standard for subordinate bias liability. Rejecting the stricter "rubber stamp" version of liability, the court began by noting that the term "decisionmaker" did not appear in Title VII and that limiting liability to actual decision makers 50. 450 F.3d 476 (10th Cir. 2006). Commentators have noted that the Ninth, Second, Third, Sixth, Eighth, and Eleventh Circuits follow some variations on the middle of the road standard. See Ratliff, supra note 26, at 266-68. There appears to be some disagreement re- garding whether the Seventh Circuit still uses the standard set out in Judge Posner's decision in Shager or has adopted the more stringent standard that the Fourth Circuit follows. See, e.g., Ratliff, supra note 26, at 266 (arguing that the Seventh Circuit has maintained its centrist position); Eber, supra note 2, at 164-65 (placing the Seventh Circuit in the more stringent group). 51. BCI, 450 F.3d at 477. 52. Id at 482-83. 53. Id. at 480. 54. Id. at 481. 55. Id. at 478-79, 483. 56. Id. at 482. 57. BCI, 450 F.3d at 491. 58. Id. 59. Id at 492-93. 2012] SUBORDINATE BIAS LIABILITY 95 would undermine its deterrent effect on subordinate bias."o The court re- framed the issue as "whether the biased subordinate's discriminatory re- ports, recommendation, or other actions caused the adverse employment action""-hence, its moniker as the "causation standard."62 Arguing that this standard incorporates agency law principles that underlie Title VII lia- bility, the court also provided a potential "out" for defendants." It explained that if the employer had conducted an independent investigation of the alle- gations made against the employee, the employer could no longer be said to have relied upon the representations of the discriminatory employee, and the chain of causation would be broken.' The court suggested that this is not too tough a standard for an employer to meet: "[S]imply asking an employee for his version of events may defeat the inference that an employment deci- sion was racially discriminatory."" As the court explained, this provides employers with "a powerful incentive to hear both sides of the story before taking an adverse employment action against a member of a protected class."" The most difficult standard for plaintiffs, sometimes referred to as the "actual decisionmaker" standard, is typified by the Fourth Circuit's deci- sion in Hill v. Lockheed Martin Logistics Mgmt., Inc." Sheet metal mechan- ic Ethel Hill claimed Lockheed fired her based on her sex and age as well as in retaliation for complaining about such discrimination. Like other cases involving subordinate bias liability, Hill worked directly under supervisors who did not have the authority to hire and fire." She also worked with Ed Fultz, a safety inspector who, although he had no supervisory authority, reported work infractions to Hill's superiors." Hill argued that the sex and age discriminatory animus of Fultz motivated his complaints and resulted in two reprimands from her direct supervisor, Dixon, which in turn led to her termination.72 According to Hill, Fultz made derogatory statements to her, including "calling her a 'useless old lady' who needed to be retired, a 'trou- bled old lady' and a 'damn woman,' on several occasions while they were 60. Id at 487. 61. Id 62. Id at 487; see Eber, supra note 2, at 157-58. 63. BCI, 450 F.3d at 485-86, 488. 64. Id at 488-89. 65. Id. at 488 (citing Kendrick v. Penske Transp. Servs. Inc., 220 F.3d 1220, 1231-32 (10th Cir. 2000)). 66. Id. 67. See Eber, supra note 2, at 164-65. 68. 354 F.3d 277 (4th Cir. 2004) (en banc). 69. Id. at 281-82. 70. Id. at 282-83. 71. Id. at 283. 72. Id. 96 UALR LAW REVIEW [Vol. 35 working together."" The trial court granted Lockheed's motion for summary judgment, and a divided panel of the Fourth Circuit reversed." The Fourth Circuit granted an en banc hearing in the case, which resulted in the opinion that forms the basis for this approach to subordinate bias liability." While the court rejected that discrimination claims should be limited only to the actions of the final decision maker, it also made clear that the biased person in effect had to be the decision maker in order for the employ- er to be liable." As it explained: [W]e decline to endorse a construction of the discrimination statutes that would allow a biased subordinate who has no supervisory or disciplinary authority and who does not make the final or formal employment deci- sion to become a decisionmaker simply because he had a substantial in- fluence on the ultimate decision or because he has played a role, even a significant one, in the adverse employment decision."7 Relying largely on Reeves v. Sanderson Plumbing" and agency princi- ples coming out of sexual harassment cases, the court concluded that in order to survive summary judgment in a case involving subordinate bias liability, a plaintiff "must come forward with sufficient evidence that the subordinate employee possessed such authority as to be viewed as the one principally responsible for the decision or the actual decisionmaker for the employer."so Thus, in Hill's case, Fultz would have had to be the de facto decision maker." From there, the court examined each individual reprimand and the final decision to terminate Hill, finally holding that Fultz did not have sufficient involvement in Hill's termination to be considered the actual decision maker.82 Interestingly, Judge Michael, joined by three of his colleagues, dissent- ed.3 He argued that the majority failed to take the facts in the light most favorable to Hill.84 He also asserted that the majority set the wrong standard for subordinate bias liability under Title VII and the Age Discrimination and Employment Act (ADEA), thereby undermining the efficacy of these anti- 73. Id. 74. Hill, 354 F.3d at 283. 75. Id. 76. Id at 290-91. 77. Id at 291. 78. 530 U.S. 133 (2000). 79. See Hill, 354 F.3d at 286-89. 80. Id. at 291. 81. Id. 82. Id. at 297. 83. See id. at 299 (Michael, J., dissenting). 84. Id. at 299-300. 2012] SUBORDINATE BIAS LIABILITY 97 discrimination statutes." Reading the facts as set out by Judge Michael sug- gests that one is reading about a wholly different fact pattern. Judge Michael described facts that suggest Fultz orchestrated Hill's termination after she complained about his discriminatory comments by writing up what could be characterized as trivial work infractions.6 Instead of adopting the de facto decision maker test, Judge Michael argued for liability where the "biased subordinate has substantial influence on an employment decision."" In this case, Fultz provided the factual basis for two of the reprimands that the de- cision maker considered in firing Hill." This, along with some factual issues surrounding one of the reprimands, led the dissenters to argue that there was sufficient evidence linking Fultz's discriminatory animus to Hill's termina- tion to make summary judgment inappropriate." Another area of confusion in subordinate bias liability cases is the role of "independent investigations" in breaking the chain of causation linking the biased employee to the actual decision maker." This issue was raised in the BCI case, and the Supreme Court of the United States actually granted certiorari in that case in 2007, only to dismiss the appeal after the parties settled." As a result, the issue has lingered. It appears that most circuits agree that an independent investigation that reveals misconduct by the disci- plined employee severs the chain of causation.92 They disagree, however, regarding what that investigation must look like and who gets to make the call on the sufficiency of the investigation-the judge at summary judgment or the jury at trial." Some courts are satisfied if the employee is asked to provide his or her side of the story.94 Other courts have held that employees who fail to raise the issue of discrimination when presented with an oppor- tunity to do so are barred from arguing that the employer conducted an im- 85. Hill, 354 F.3d at 299, 301 (Michael, J., dissenting). 86. See id. at 299-301. 87. Id. at 304. 88. Id. at 305. 89. Id. 90. See Ratliff, supra note 26, at 268-72 (describing the split among the circuit courts). 91. See EEOC v. BCI Coca-Cola Bottling Co. of L.A., 450 F.3d 476 (10th Cir. 2006), cert. granted,B CI Coca-Cola Bottling Co. of L.A. v. EEOC, 549 U.S. 1105 (2007), and cert. dismissed, 549 U.S. 1334 (2007); see also Hannah Banks, Comment, Staub v. Proctor Hospi- tal: Cleaning Up the Cat's Paw, 6 DuKE J. CONST. L. & PUB. POL'Y SIDEBAR 71, 80 (2011) (noting history). 92. See Ratliff, supra note 26, at 268. 93. See id. at 269-72 (describing cases). 94. See, e.g., BCI, 450 F.3d at 491-93 (suggesting summary judgment for employer might have been appropriate had employer sought out plaintiffs version of the facts); Llampallas v. Mini-Circuits, Lab, Inc., 163 F.3d 1236, 1250 (11 th Cir. 1998).